Hong Kong's Legislative Council has passed the Stablecoin Ordinance Bill, establishing a licensing and regulatory framework for "fiat stablecoin issuers." By the end of this year, compliant Hong Kong stablecoins are expected to officially launch, with related concept stocks showing notable market movements.
Key Players in Hong Kong's Stablecoin Sandbox
Three groups currently hold the first batch of sandbox approvals from the Hong Kong Monetary Authority (HKMA):
- RD InnoTech (Yuan Coin Innovation Technology)
- JD Coin Chain Technology (Hong Kong) (affiliated with JD.com)
- Standard Chartered Bank (Hong Kong) Limited, Animoca Brands Limited, and Hong Kong Telecommunications (HKT) Limited
Top Stablecoin-Related Stocks to Watch
1. LianLian Digital (2598.HK)
- Services: Digital payment solutions and value-added services
- Stablecoin Project: Partnered with RD InnoTech for cross-border payment applications
Financial Highlights:
- 2024 revenue: RMB 1.315 billion (+27.9% YoY)
- Narrowed losses from RMB 656 million (2023) to RMB 167 million
- Adjusted profit: RMB 78.7 million
- Total payment volume (TPV): Surged 64.7% to over RMB 3.3 trillion
- Gross margin: 51.9%
- Key Advantage: Holds Hong Kong VATP license with strategic Web3.0 positioning
2. ZhongAn Online (6060.HK)
- Banking Arm: ZhongAn Bank (43.43% owned) is Hong Kong's first digital bank to provide reserve banking services for stablecoin issuers
- Exposure: Indirect 8.7% stake in RD InnoTech
Potential Benefits:
- Valuation upside from RD InnoTech
- Attractive net interest margins
3. JD.com Group-SW (9618.HK)
- Sandbox Progress: Phase 2 testing of JD-HKD stablecoin
Focus Areas:
- Cross-border payments
- Supply chain finance integration with digital RMB
4. Standard Chartered (2888.HK) & HKT (6823.HK)
- Joint Venture: Developing HKD-pegged stablecoin targeting Greater Bay Area remittance cost reduction
5. OSL Group (863.HK)
- Positioning: Asia's leading compliant digital asset infrastructure platform
2024 Performance:
- Record revenue: HK$375 million (+79% YoY)
- Operating profit: HK$55 million (vs. HK$250 million loss in 2023)
6. New Huo Technology (1611.HK)
- Services: Virtual asset trading and tech solutions
- Growth Driver: Expanding crypto trading volumes amid Hong Kong's Web3 hub development
Why Stablecoins Are Gaining Global Attention
Regulatory Milestones:
- Hong Kong's pioneering Stablecoin Ordinance sets first comprehensive framework
- U.S. GENIUS Act advances federal stablecoin oversight
Market Developments:
- Circle's planned NYSE IPO (target valuation: $6.7 billion)
- Bitcoin's historic rally past $110,000
Stablecoin Fundamentals
Primary Characteristics:
- Peg Mechanism: 1:1 USD backing via reserves
- Reserve Composition: >80% in cash/short-term U.S. Treasuries
- Transparency: Regular third-party audits
- Adoption: Dominates 90% of stablecoin market (USDT + USDC)
Use Cases:
✅ Crypto market "safe haven" during volatility
✅ Cross-border remittances (<1% cost vs. traditional 6.3%)
✅ DeFi ecosystem cornerstone
Regulatory Outlook
The Stablecoin Ordinance requires all HKD-pegged stablecoin issuers (local or foreign) to obtain HKMA licensing, with strict reserve management and redemption rules. VATP license holders stand to benefit significantly from new revenue streams.
👉 Explore Hong Kong's Web3 regulatory framework
FAQs
Q: Why are stablecoins important for crypto markets?
A: They provide price stability amidst cryptocurrency volatility, serving as a bridge between traditional finance and digital assets.
Q: How does Hong Kong's approach differ from other jurisdictions?
A: Hong Kong is the first to implement comprehensive fiat-backed stablecoin regulations, prioritizing consumer protection while fostering innovation.
Q: What risks do stablecoin investors face?
A: Primary risks include reserve mismanagement, regulatory changes, and issuer insolvency—highlighting the importance of licensed operators.
👉 Learn about compliant stablecoin investments
Note: All financial data reflects reported figures as of 2024. Investors should conduct independent research before making decisions.